(Exact name of Registrant as specified in its charter)
|
||
Maryland
|
38-3041398
|
|
(State of incorporation)
|
(IRS Employer
Identification No.)
|
|
200 International Circle, Suite 3500, Hunt Valley, MD 21030
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||
(Address of principal executive offices)
|
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(410) 427-1700
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(Telephone number, including area code)
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Common Stock, $.10 par value | 117,155,264 | |
(Class) | (Number of shares) |
Page
No.
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2
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3
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4
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5
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6
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22
|
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33
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33
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34
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34
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36
|
June 30,
|
December 31,
|
|||||||
2013
|
2012
|
|||||||
(Unaudited)
|
||||||||
ASSETS
|
||||||||
Real estate properties
|
||||||||
Land and buildings
|
$ | 3,051,363 | $ | 3,038,553 | ||||
Less accumulated depreciation
|
(643,514 | ) | (580,373 | ) | ||||
Real estate properties – net
|
2,407,849 | 2,458,180 | ||||||
Mortgage notes receivable – net
|
241,254 | 238,621 | ||||||
2,649,103 | 2,696,801 | |||||||
Other investments – net
|
74,646 | 47,339 | ||||||
2,723,749 | 2,744,140 | |||||||
Assets held for sale – net
|
1,020 | 1,020 | ||||||
Total investments
|
2,724,769 | 2,745,160 | ||||||
Cash and cash equivalents
|
7,039 | 1,711 | ||||||
Restricted cash
|
40,127 | 36,660 | ||||||
Accounts receivable – net
|
138,059 | 125,180 | ||||||
Other assets
|
69,802 | 73,294 | ||||||
Total assets
|
$ | 2,979,796 | $ | 2,982,005 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
||||||||
Revolving line of credit
|
$ | 5,000 | $ | 158,000 | ||||
Term loan
|
200,000 | 100,000 | ||||||
Secured borrowings
|
301,526 | 366,538 | ||||||
Unsecured borrowings – net
|
1,200,139 | 1,200,394 | ||||||
Accrued expenses and other liabilities
|
135,835 | 145,744 | ||||||
Total liabilities
|
1,842,500 | 1,970,676 | ||||||
Stockholders’ equity:
|
||||||||
Common stock $.10 par value 200,000 shares authorized –– 117,152 shares as of June 30, 2013 and 112,393 as of December 31, 2012 issued and outstanding
|
11,715 | 11,239 | ||||||
Common stock – additional paid-in capital
|
1,807,201 | 1,664,855 | ||||||
Cumulative net earnings
|
841,306 | 754,128 | ||||||
Cumulative dividends paid
|
(1,522,926 | ) | (1,418,893 | ) | ||||
Total stockholders’ equity
|
1,137,296 | 1,011,329 | ||||||
Total liabilities and stockholders’ equity
|
$ | 2,979,796 | $ | 2,982,005 |
2 |
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
June 30,
|
June 30,
|
|||||||||||||||
2013
|
2012
|
2013
|
2012
|
|||||||||||||
Revenue
|
||||||||||||||||
Rental income
|
$ | 93,069 | $ | 75,228 | $ | 186,178 | $ | 151,203 | ||||||||
Mortgage interest income
|
7,435 | 7,404 | 14,781 | 14,740 | ||||||||||||
Other investment income – net
|
1,860 | 1,165 | 3,166 | 2,295 | ||||||||||||
Miscellaneous
|
151 | 28 | 151 | 102 | ||||||||||||
Total operating revenues
|
102,515 | 83,825 | 204,276 | 168,340 | ||||||||||||
Expenses
|
||||||||||||||||
Depreciation and amortization
|
32,225 | 27,199 | 64,184 | 54,346 | ||||||||||||
General and administrative
|
5,483 | 4,954 | 10,680 | 10,480 | ||||||||||||
Acquisition costs
|
9 | 98 | 143 | 203 | ||||||||||||
Impairment loss on real estate properties
|
- | - | - | 272 | ||||||||||||
Provisions for uncollectible mortgages, notes and accounts receivable
|
65 | - | 65 | - | ||||||||||||
Total operating expenses
|
37,782 | 32,251 | 75,072 | 65,301 | ||||||||||||
Income before other income and expense
|
64,733 | 51,574 | 129,204 | 103,039 | ||||||||||||
Other income (expense)
|
||||||||||||||||
Interest income
|
14 | 9 | 17 | 16 | ||||||||||||
Interest expense
|
(24,952 | ) | (24,009 | ) | (50,624 | ) | (46,976 | ) | ||||||||
Interest – amortization of deferred financing costs
|
(698 | ) | (668 | ) | (1,380 | ) | (1,297 | ) | ||||||||
Interest
– refinancing gain (costs)
|
11,112 | 1,698 | 11,112 | (5,410 | ) | |||||||||||
Total other expense
|
(14,524 | ) | (22,970 | ) | (40,875 | ) | (53,667 | ) | ||||||||
Income before gain on assets sold
|
50,209 | 28,604 | 88,329 | 49,372 | ||||||||||||
(Loss) gain on assets sold – net
|
(1,151 | ) | 1,968 | (1,151 | ) | 7,284 | ||||||||||
Net income available to common stockholders
|
$ | 49,058 | $ | 30,572 | $ | 87,178 | $ | 56,656 | ||||||||
Income per common share available to common shareholders:
|
||||||||||||||||
Basic:
|
||||||||||||||||
Net income
|
$ | 0.42 | $ | 0.29 | $ | 0.76 | $ | 0.54 | ||||||||
Diluted:
|
||||||||||||||||
Net income
|
$ | 0.42 | $ | 0.29 | $ | 0.76 | $ | 0.54 | ||||||||
Dividends declared and paid per common share
|
$ | 0.46 | $ | 0.42 | $ | 0.91 | $ | 0.83 | ||||||||
Weighted-average shares outstanding, basic
|
116,199 | 105,717 | 114,491 | 104,736 | ||||||||||||
Weighted-average shares outstanding, diluted
|
117,022 | 106,033 | 115,273 | 105,023 |
3 |
Common
Stock Par
Value
|
Additional
Paid-in Capital
|
Cumulative
Net Earnings
|
Cumulative
Dividends
|
Total
|
||||||||||||||||
Balance at December 31, 2012 (112,393 common shares)
|
$ | 11,239 | $ | 1,664,855 | $ | 754,128 | $ | (1,418,893 | ) | $ | 1,011,329 | |||||||||
Issuance of common stock:
|
||||||||||||||||||||
Grant
of restricted stock to company directors (15 shares at $30.33 per share)
|
2 | (2 | ) | — | — | — | ||||||||||||||
Amortization of restricted stock
|
— | 2,883 | — | — | 2,883 | |||||||||||||||
Dividend reinvestment plan (1,462 shares at $28.46 per share)
|
146 | 41,442 | — | — | 41,588 | |||||||||||||||
Grant of stock as payment of directors fees (3 shares at an average of $32.17 per share)
|
— | 87 | — | — | 87 | |||||||||||||||
Equity Shelf Program (3,279 shares at $30.69 per share, net of issuance costs)
|
328 | 97,936 | — | — | 98,264 | |||||||||||||||
Net income
|
— | — | 87,178 | — | 87,178 | |||||||||||||||
Common dividends ($0.91 per share)
|
— | — | — | (104,033 | ) | (104,033 | ) | |||||||||||||
Balance at June 30, 2013 (117,152 common shares)
|
$ | 11,715 | $ | 1,807,201 | $ | 841,306 | $ | (1,522,926 | ) | $ | 1,137,296 |
4 |
Six Months Ended
June 30,
|
||||||||
2013
|
2012
|
|||||||
Cash flows from operating activities
|
||||||||
Net income
|
$ | 87,178 | $ | 56,656 | ||||
Adjustment to reconcile net income to cash provided by operating activities:
|
||||||||
Depreciation and amortization
|
64,184 | 54,346 | ||||||
Impairment on real estate properties
|
— | 272 | ||||||
Provision for uncollectible mortgages, notes and accounts receivable
|
65 | — | ||||||
Amortization
of deferred financing and debt extinguishment (gain)/costs
|
(9,732 | ) | 6,707 | |||||
Restricted stock amortization expense
|
2,924 | 2,971 | ||||||
Loss (gain) on assets sold – net
|
1,151 | (7,284 | ) | |||||
Amortization of acquired in-place leases - net
|
(2,503 | ) | (2,852 | ) | ||||
Other
|
— | (75 | ) | |||||
Change in operating assets and liabilities – net of amounts assumed/acquired:
|
||||||||
Accounts receivable, net
|
147 | 370 | ||||||
Straight-line rent
|
(13,702 | ) | (13,120 | ) | ||||
Lease inducement
|
1,685 | 1,684 | ||||||
Effective yield receivable on mortgage notes
|
(1,074 | ) | (1,113 | ) | ||||
Other operating assets and liabilities
|
(8,995 | ) | (4,138 | ) | ||||
Net cash provided by operating activities
|
121,328 | 94,424 | ||||||
Cash flows from investing activities
|
||||||||
Acquisition of real estate – net of liabilities assumed and escrows acquired
|
— | (26,922 | ) | |||||
Placement of mortgage loans
|
(2,869 | ) | (4,955 | ) | ||||
Proceeds from sale of real estate investments
|
2,288 | 22,006 | ||||||
Capital
improvements to real estate investments
|
(17,307 | ) | (14,207 | ) | ||||
Proceeds from other investments
|
2,942 | 10,040 | ||||||
Investments in other investments
|
(30,248 | ) | (3,558 | ) | ||||
Collection of mortgage principal
|
237 | 243 | ||||||
Net cash used in investing activities
|
(44,957 | ) | (17,353 | ) | ||||
Cash flows from financing activities
|
||||||||
Proceeds from credit facility borrowings
|
201,000 | 92,000 | ||||||
Payments on credit facility borrowings
|
(254,000 | ) | (362,500 | ) | ||||
Receipts of other long-term borrowings
|
59,355 | 400,000 | ||||||
Payments of other long-term borrowings
|
(112,208 | ) | (188,674 | ) | ||||
Payments of financing related costs
|
(1,032 | ) | (12,920 | ) | ||||
Receipts from dividend reinvestment plan
|
41,588 | 68,976 | ||||||
Net proceeds from issuance of common stock
|
98,264 | 15,574 | ||||||
Dividends paid
|
(104,010 | ) | (87,017 | ) | ||||
Net cash used in financing activities
|
(71,043 | ) | (74,561 | ) | ||||
Increase in cash and cash equivalents
|
5,328 | 2,510 | ||||||
Cash and cash equivalents at beginning of period
|
1,711 | 351 | ||||||
Cash and cash equivalents at end of period
|
$ | 7,039 | $ | 2,861 | ||||
Interest paid during the period, net of amounts capitalized
|
$ | 51,397 | $ | 46,323 |
5 |
6 |
June 30,
|
December 31,
|
|||||||
2013
|
2012
|
|||||||
(in thousands)
|
||||||||
Contractual receivables
|
$ | 3,757 | $ | 3,963 | ||||
Effective yield interest receivables
|
4,650 | 3,576 | ||||||
Straight-line receivables
|
112,610 | 98,973 | ||||||
Lease inducements
|
17,622 | 19,307 | ||||||
Allowance
|
(580 | ) | (639 | ) | ||||
Accounts receivable – net
|
$ | 138,059 | $ | 125,180 |
7 |
Pro Forma
|
||||||||||||||||
Three Months Ended
June 30,
|
Six Months Ended
June 30,
|
|||||||||||||||
2013
|
2012
|
2013
|
2012
|
|||||||||||||
(in thousands, except per share amount, unaudited)
|
||||||||||||||||
Revenues
|
$ | 102,515 | $ | 97,331 | $ | 204,276 | $ | 195,352 | ||||||||
Net income available to common stockholders
|
$ | 49,058 | $ | 36,178 | $ | 87,178 | $ | 67,868 | ||||||||
Earnings per share – diluted:
|
||||||||||||||||
Net income available to common stockholders – as reported
|
$ | 0.42 | $ | 0.29 | $ | 0.76 | $ | 0.54 | ||||||||
Net income available to common stockholders – pro forma
|
$ | 0.42 | $ | 0.34 | $ | 0.76 | $ | 0.65 |
8 |
June 30,
|
December 31,
|
|||||||
2013
|
2012
|
|||||||
(in thousands)
|
||||||||
Other Investment note due 2015
|
$ | 2,418 | $ | 2,518 | ||||
Other Investment notes due 2021 - 2023
|
12,061 | 9,775 | ||||||
Other Investment note due 2013
|
559 | 1,018 | ||||||
Other Investment note due 2014
|
438 | 812 | ||||||
$28.0
Million Other Investment note due 2017
|
25,250 | 26,500 | ||||||
$6.0 Million Other Investment note due 2013
|
5,439 | 3,450 | ||||||
Other Investment note due 2013
|
- | 261 | ||||||
$1.3 Million Other Investment note due 2017
|
965 | 425 | ||||||
$25.0 Million Other Investment note due 2017
|
24,936 | - | ||||||
Notes receivable, gross
(1)
|
72,066 | 44,759 | ||||||
Allowance for loss on notes receivable
|
(1,977 | ) | (1,977 | ) | ||||
Notes receivable, net
|
70,089 | 42,782 | ||||||
Marketable securities and other
|
4,557 | 4,557 | ||||||
Total other investments
|
$ | 74,646 | $ | 47,339 |
|
(1)
|
The majority of these notes bear interest at approximately 10% annually.
|
9 |
10 |
Three Months Ended
June 30,
|
Six Months Ended
June 30,
|
|||||||||||||||
2013
|
2012
|
2013
|
2012
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Stock-based compensation expense
|
$ | 1,472 | $ | 1,486 | $ | 2,924 | $ | 2,971 |
11 |
Shares/
Units |
Grant Date
Average Fair Value Per Unit/ Share |
Total
Compensation Cost
(in millions)
|
Weighted
Average Period of Expense Recognition (in months) |
Unrecognized
Compensation Cost
(in millions)
|
||||||||||||||||
Restricted stock
|
428,503 | $ | 22.44 | $ | 9.6 | 36 | $ | 1.6 | ||||||||||||
2013 Annual PRSUs
|
124,244 | $ | 8.92 | 1.1 | 12 | 0.6 | ||||||||||||||
Multi-year absolute TSR PRSUs
|
279,550 | $ | 11.06 | 3.1 | 44 | 0.9 | ||||||||||||||
Multi-year relative TSR PRSUs
|
93,183 | $ | 12.26 | 1.1 | 44 | 0.3 | ||||||||||||||
Total
|
925,480 | $ | 14.93 | $ | 14.9 | $ | 3.4 |
12 |
Current
|
June 30,
|
December 31,
|
|||||||||||||
Maturity
|
Rate
|
2013
|
2012
|
||||||||||||
(in thousands)
|
|||||||||||||||
Secured borrowings:
|
|||||||||||||||
HUD Berkadia mortgages assumed June 2010
|
2036 - 2040 | - | $ | — | $ | 62,921 | |||||||||
HUD Capital Funding mortgages assumed June 2010
(1)
|
2040 - 2045 | 4.85 | % | 129,773 | 130,887 | ||||||||||
HUD mortgages assumed October 2011
(1)
|
2036 - 2040 | 4.87 | % | 31,571 | 31,991 | ||||||||||
HUD mortgages assumed December 2011
(1)
|
2044 | 3.06 | % | 59,166 | 58,884 | ||||||||||
HUD mortgages assumed December 2012
(1)
|
2031 - 2045 | 5.50 | % | 81,016 | 81,855 | ||||||||||
Total secured borrowings
|
301,526 | 366,538 | |||||||||||||
Unsecured borrowings:
|
|||||||||||||||
Revolving line of credit
|
2016 | 1.69 | % | $ | 5,000 | $ | 158,000 | ||||||||
Term Loan
|
2017 | 1.94 | % | 200,000 | 100,000 | ||||||||||
205,000 | 258,000 | ||||||||||||||
2020 Notes
|
2020 | 7.50 | % | 200,000 | 200,000 | ||||||||||
2022 Notes
|
2022 | 6.75 | % | 575,000 | 575,000 | ||||||||||
2024 Notes
|
2024 | 5.875 | % | 400,000 | 400,000 | ||||||||||
Subordinated debt
|
2021 | 9.00 | % | 20,969 | 21,049 | ||||||||||
1,195,969 | 1,196,049 | ||||||||||||||
Premium - net
|
4,170 | 4,345 | |||||||||||||
Total unsecured borrowings
|
1,405,139 | 1,458,394 | |||||||||||||
Totals – net
|
$ | 1,706,665 | $ | 1,824,932 |
|
(1)
|
Reflects the weighted average annual interest rate on the mortgages.
|
13 |
14 |
June 30, 2013
|
December 31, 2012
|
|||||||||||||||
Carrying
Amount
|
Fair
Value
|
Carrying
Amount
|
Fair
Value
|
|||||||||||||
Assets:
|
(in thousands)
|
|||||||||||||||
Cash and cash equivalents
|
$ | 7,039 | $ | 7,039 | $ | 1,711 | $ | 1,711 | ||||||||
Restricted cash
|
40,127 | 40,127 | 36,660 | 36,660 | ||||||||||||
Mortgage notes receivable – net
|
241,254 | 239,346 | 238,621 | 235,705 | ||||||||||||
Other investments – net
|
74,646 | 71,596 | 47,339 | 44,077 | ||||||||||||
Totals
|
$ | 363,066 | $ | 358,108 | $ | 324,331 | $ | 318,153 | ||||||||
Liabilities:
|
||||||||||||||||
Revolving line of credit
|
$ | 5,000 | $ | 5,000 | $ | 158,000 | $ | 158,000 | ||||||||
Term loan
|
200,000 | 200,000 | 100,000 | 100,000 | ||||||||||||
7.50% Notes due 2020 – net
|
197,718 | 228,267 | 197,546 | 252,363 | ||||||||||||
6.75% Notes due 2022 – net
|
581,452 | 648,030 | 581,799 | 724,240 | ||||||||||||
5.875% Notes due 2024 – net
|
400,000 | 424,311 | 400,000 | 441,761 | ||||||||||||
HUD debt
|
301,526 | 304,041 | 366,538 | 433,803 | ||||||||||||
Subordinated debt
|
20,969 | 25,118 | 21,049 | 27,896 | ||||||||||||
Totals
|
$ | 1,706,665 | $ | 1,834,767 | $ | 1,824,932 | $ | 2,138,063 |
|
●
|
Cash and cash equivalents and restricted cash: The carrying amount of cash and cash equivalents and restricted cash reported in the balance sheet approximates fair value because of the short maturity of these instruments (i.e., less than 90 days).
|
|
●
|
Mortgage notes receivable: The fair values of the mortgage notes receivables are estimated using a discounted cash flow analysis, using interest rates being offered for similar loans to borrowers with similar credit ratings (Level 3).
|
|
●
|
Other investments: Other investments are primarily comprised
of: (i) notes receivable and (ii) an investment in a redeemable non-convertible preferred security of an unconsolidated
business accounted for using the cost method of accounting. The fair values of notes receivable are estimated using
a discounted cash flow analysis, using interest rates being offered for similar loans to borrowers with similar credit ratings
(Level 3). The fair value of the investment in the unconsolidated business is estimated using quoted market value and
considers the terms of the underlying arrangement (Level 3).
|
15 |
|
●
|
Revolving line of credit: The fair value of our borrowings under variable rate agreements are estimated using an expected present value technique based on expected cash flows discounted using the current market rates (Level 2).
|
|
●
|
Senior notes and other long-term borrowings: The fair value of our borrowings under fixed rate agreements are estimated based on open market trading activity provided by a third party (Level 2).
|
16 |
Three Months Ended
June 30,
|
Six Months Ended
June 30,
|
|||||||||||||||
2013
|
2012
|
2013
|
2012
|
|||||||||||||
(in thousands, except per share amounts)
|
||||||||||||||||
Numerator:
|
||||||||||||||||
Net income
|
$ | 49,058 | $ | 30,572 | $ | 87,178 | $ | 56,656 | ||||||||
Numerator for net income available to common per share - basic and diluted
|
$ | 49,058 | $ | 30,572 | $ | 87,178 | $ | 56,656 | ||||||||
Denominator:
|
||||||||||||||||
Denominator for basic earnings per share
|
116,199 | 105,717 | 114,491 | 104,736 | ||||||||||||
Effect of dilutive securities:
|
||||||||||||||||
Restricted stock
|
786 | 299 | 750 | 270 | ||||||||||||
Deferred stock
|
37 | 17 | 32 | 17 | ||||||||||||
Denominator for diluted earnings per share
|
117,022 | 106,033 | 115,273 | 105,023 | ||||||||||||
Earnings per share – basic:
|
||||||||||||||||
Net income – basic
|
$ | 0.42 | $ | 0.29 | $ | 0.76 | $ | 0.54 | ||||||||
Earnings per share – diluted:
|
||||||||||||||||
Net income – diluted
|
$ | 0.42 | $ | 0.29 | $ | 0.76 | $ | 0.54 |
17 |
June 30, 2013
|
||||||||||||||||
Issuer & Subsidiary
Guarantors |
Non-Guarantor Subsidiaries |
Elimination
Company |
Consolidated
|
|||||||||||||
ASSETS
|
||||||||||||||||
Real estate properties
|
||||||||||||||||
Land and buildings
|
$ | 2,479,752 | $ | 571,611 | $ | - | $ | 3,051,363 | ||||||||
Less accumulated depreciation
|
(585,589 | ) | (57,925 | ) | - | (643,514 | ) | |||||||||
Real estate properties – net
|
1,894,163 | 513,686 | - | 2,407,849 | ||||||||||||
Mortgage notes receivable – net
|
241,254 | - | - | 241,254 | ||||||||||||
2,135,417 | 513,686 | - | 2,649,103 | |||||||||||||
Other investments – net
|
74,646 | - | - | 74,646 | ||||||||||||
2,210,063 | 513,686 | - | 2,723,749 | |||||||||||||
Assets held for sale – net
|
1,020 | - | - | 1,020 | ||||||||||||
Total investments
|
2,211,083 | 513,686 | - | 2,724,769 | ||||||||||||
Cash and cash equivalents
|
7,039 | - | - | 7,039 | ||||||||||||
Restricted cash
|
6,677 | 33,450 | - | 40,127 | ||||||||||||
Accounts receivable – net
|
129,141 | 8,918 | - | 138,059 | ||||||||||||
Investment in affiliates
|
222,047 | - | (222,047 | ) | - | |||||||||||
Other assets
|
35,234 | 34,568 | - | 69,802 | ||||||||||||
Total assets
|
$ | 2,611,221 | $ | 590,622 | $ | (222,047 | ) | $ | 2,979,796 | |||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
||||||||||||||||
Revolving line of credit
|
$ | 5,000 | $ | - | $ | - | $ | 5,000 | ||||||||
Term loan
|
200,000 | - | - | 200,000 | ||||||||||||
Secured borrowings
|
- | 301,526 | - | 301,526 | ||||||||||||
Unsecured borrowings – net
|
1,179,170 | 20,969 | - | 1,200,139 | ||||||||||||
Accrued expenses and other liabilities
|
89,755 | 46,080 | - | 135,835 | ||||||||||||
Intercompany payable
|
- | 181,624 | (181,624 | ) | - | |||||||||||
Total liabilities
|
1,473,925 | 550,199 | (181,624 | ) | 1,842,500 | |||||||||||
Stockholders’ equity:
|
||||||||||||||||
Common stock
|
11,715 | - | - | 11,715 | ||||||||||||
Common stock – additional paid-in capital
|
1,807,201 | - | - | 1,807,201 | ||||||||||||
Cumulative net earnings
|
841,306 | 40,423 | (40,423 | ) | 841,306 | |||||||||||
Cumulative dividends paid
|
(1,522,926 | ) | - | - | (1,522,926 | ) | ||||||||||
Total stockholders’ equity
|
1,137,296 | 40,423 | (40,423 | ) | 1,137,296 | |||||||||||
Total liabilities and stockholders’ equity
|
$ | 2,611,221 | $ | 590,622 | (222,047 | ) | $ | 2,979,796 |
18 |
December 31, 2012
|
||||||||||||||||
Issuer & Subsidiary Guarantors |
Non – Guarantor
Subsidiaries |
Elimination
Company |
Consolidated
|
|||||||||||||
ASSETS
|
||||||||||||||||
Real estate properties
|
||||||||||||||||
Land and buildings
|
$ | 2,466,866 | $ | 571,687 | $ | — | $ | 3,038,553 | ||||||||
Less accumulated depreciation
|
(535,223 | ) | (45,150 | ) | — | (580,373 | ) | |||||||||
Real estate properties – net
|
1,931,643 | 526,537 | — | 2,458,180 | ||||||||||||
Mortgage notes receivable – net
|
238,621 | — | — | 238,621 | ||||||||||||
2,170,264 | 526,537 | — | 2,696,801 | |||||||||||||
Other investments – net
|
47,339 | — | — | 47,339 | ||||||||||||
2,217,603 | 526,537 | — | 2,744,140 | |||||||||||||
Assets held for sale – net
|
1,020 | — | — | 1,020 | ||||||||||||
Total investments
|
2,218,623 | 526,537 | — | 2,745,160 | ||||||||||||
Cash and cash equivalents
|
1,711 | — | — | 1,711 | ||||||||||||
Restricted cash
|
7,078 | 29,582 | — | 36,660 | ||||||||||||
Accounts receivable – net
|
118,473 | 6,707 | — | 125,180 | ||||||||||||
Investment in affiliates
|
163,610 | — | (163,610 | ) | — | |||||||||||
Other assets
|
38,224 | 35,070 | — | 73,294 | ||||||||||||
Total assets
|
$ | 2,547,719 | $ | 597,896 | (163,610 | ) | $ | 2,982,005 | ||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
||||||||||||||||
Revolving line of credit
|
$ | 158,000 | $ | — | $ | — | $ | 158,000 | ||||||||
Term loan
|
100,000 | — | — | 100,000 | ||||||||||||
Secured borrowings
|
— | 366,538 | — | 366,538 | ||||||||||||
Unsecured borrowings – net
|
1,179,345 | 21,049 | — | 1,200,394 | ||||||||||||
Accrued expenses and other liabilities
|
99,045 | 46,699 | — | 145,744 | ||||||||||||
Intercompany payable
|
— | 143,158 | (143,158 | ) | — | |||||||||||
Total liabilities
|
1,536,390 | 577,444 | (143,158 | ) | 1,970,676 | |||||||||||
Stockholders’ equity:
|
||||||||||||||||
Common stock
|
11,239 | — | — | 11,239 | ||||||||||||
Common stock – additional paid-in-capital
|
1,664,855 | — | — | 1,664,855 | ||||||||||||
Cumulative net earnings
|
754,128 | 20,452 | (20,452 | ) | 754,128 | |||||||||||
Cumulative dividends paid
|
(1,418,893 | ) | — | — | (1,418,893 | ) | ||||||||||
Total stockholders’ equity
|
1,011,329 | 20,452 | (20,452 | ) | 1,011,329 | |||||||||||
Total liabilities and stockholders’ equity
|
$ | 2,547,719 | $ | 597,896 | $ | (163,610 | ) | $ | 2,982,005 |
19 |
Three Months Ended June 30, 2013 |
Six Months Ended June 30, 2013
|
|||||||||||||||||||||||||||||||
Issuer & Subsidiary Guarantors |
Non –
Guarantor Subsidiaries |
Elimination
|
Consolidated
|
Issuer &
Subsidiary Guarantors |
Non –
Guarantor Subsidiaries |
Elimination
|
Consolidated
|
|||||||||||||||||||||||||
Revenue
|
||||||||||||||||||||||||||||||||
Rental income
|
$ | 77,602 | $ | 15,467 | $ | - | $ | 93,069 | $ | 155,243 | $ | 30,935 | $ | - | $ | 186,178 | ||||||||||||||||
Mortgage interest income
|
7,435 | - | - | 7,435 | 14,781 | - | - | 14,781 | ||||||||||||||||||||||||
Other investment income – net
|
1,860 | - | - | 1,860 | 3,166 | - | - | 3,166 | ||||||||||||||||||||||||
Miscellaneous
|
151 | - | - | 151 | 151 | - | - | 151 | ||||||||||||||||||||||||
Total operating revenues
|
87,048 | 15,467 | - | 102,515 | 173,341 | 30,935 | - | 204,276 | ||||||||||||||||||||||||
Expenses
|
||||||||||||||||||||||||||||||||
Depreciation and amortization
|
25,834 | 6,391 | - | 32,225 | 51,409 | 12,775 | - | 64,184 | ||||||||||||||||||||||||
General and administrative
|
5,400 | 83 | - | 5,483 | 10,482 | 198 | - | 10,680 | ||||||||||||||||||||||||
Acquisition costs
|
9 | - | - | 9 | 143 | - | - | 143 | ||||||||||||||||||||||||
Provision for uncollectible mortgages, notes and accounts receivable
|
65 | - | - | 65 | 65 | - | - | 65 | ||||||||||||||||||||||||
Total operating expenses
|
31,308 | 6,474 | - | 37,782 | 62,099 | 12,973 | - | 75,072 | ||||||||||||||||||||||||
Income before other income and expense
|
55,740 | 8,993 | - | 64,733 | 111,242 | 17,962 | - | 129,204 | ||||||||||||||||||||||||
Other income (expense):
|
||||||||||||||||||||||||||||||||
Interest income
|
6 | 8 | - | 14 | 1 | 16 | - | 17 | ||||||||||||||||||||||||
Interest expense
|
(20,736 | ) | (4,216 | ) | - | (24,952 | ) | (41,510 | ) | (9,114 | ) | - | (50,624 | ) | ||||||||||||||||||
Interest – amortization of deferred financing costs
|
(693 | ) | (5 | ) | - | (698 | ) | (1,375 | ) | (5 | ) | - | (1,380 | ) | ||||||||||||||||||
Interest – refinancing gain (costs)
|
- | 11,112 | - | 11,112 | - | 11,112 | - | 11,112 | ||||||||||||||||||||||||
Equity in earnings
|
15,892 | - | (15,892 | ) | - | 19,971 | - | (19,971 | ) | - | ||||||||||||||||||||||
Total other expense
|
(5,531 | ) | 6,899 | (15,892 | ) | (14,524 | ) | (22,913 | ) | 2,009 | (19,971 | ) | (40,875 | ) | ||||||||||||||||||
Income before gain on assets sold
|
50,209 | 15,892 | (15,892 | ) | 50,209 | 88,329 | 19,971 | (19,971 | ) | 88,329 | ||||||||||||||||||||||
Loss on assets sold – net
|
(1,151 | ) | - | - | (1,151 | ) | (1,151 | ) | - | - | (1,151 | ) | ||||||||||||||||||||
Net income available to common stockholders
|
$ | 49,058 | $ | 15,892 | $ | (15,892 | ) | $ | 49,058 | $ | 87,178 | $ | 19,971 | $ | (19,971 | ) | $ | 87,178 |
20 |
Three Months Ended June 30, 2012 |
Six Months Ended June 30, 2012
|
|||||||||||||||||||||||||||||||
Issuer & Subsidiary Guarantors |
Non –
Guarantor Subsidiaries |
Elimination
Company |
Consolidated
|
Issuer &
Subsidiary Guarantors |
Non –
Guarantor Subsidiaries |
Elimination
Company |
Consolidated
|
|||||||||||||||||||||||||
Revenue
|
||||||||||||||||||||||||||||||||
Rental income
|
$ | 63,216 | $ | 12,012 | $ | - | $ | 75,228 | $ | 127,180 | $ | 24,023 | $ | - | $ | 151,203 | ||||||||||||||||
Mortgage interest income
|
7,404 | - | - | 7,404 | 14,740 | - | - | 14,740 | ||||||||||||||||||||||||
Other investment income – net
|
1,165 | - | - | 1,165 | 2,295 | - | - | 2,295 | ||||||||||||||||||||||||
Miscellaneous
|
28 | - | - | 28 | 102 | - | - | 102 | ||||||||||||||||||||||||
Total operating revenues
|
71,813 | 12,012 | - | 83,825 | 144,317 | 24,023 | - | 168,340 | ||||||||||||||||||||||||
Expenses
|
||||||||||||||||||||||||||||||||
Depreciation and amortization
|
21,889 | 5,310 | - | 27,199 | 43,788 | 10,558 | - | 54,346 | ||||||||||||||||||||||||
General and administrative
|
4,829 | 125 | - | 4,954 | 10,243 | 237 | - | 10,480 | ||||||||||||||||||||||||
Acquisition costs
|
98 | - | - | 98 | 203 | - | - | 203 | ||||||||||||||||||||||||
Impairment loss on real estate properties
|
- | - | - | - | 272 | - | - | 272 | ||||||||||||||||||||||||
Total operating expenses
|
26,816 | 5,435 | - | 32,251 | 54,506 | 10,795 | - | 65,301 | ||||||||||||||||||||||||
Income before other income and expense
|
44,997 | 6,577 | - | 51,574 | 89,811 | 13,228 | - | 103,039 | ||||||||||||||||||||||||
Other income (expense):
|
||||||||||||||||||||||||||||||||
Interest income
|
2 | 7 | - | 9 | 2 | 14 | - | 16 | ||||||||||||||||||||||||
Interest expense
|
(20,137 | ) | (3,872 | ) | - | (24,009 | ) | (39,244 | ) | (7,732 | ) | - | (46,976 | ) | ||||||||||||||||||
Interest – amortization of deferred financing costs
|
(668 | ) | - | - | (668 | ) | (1,297 | ) | - | - | (1,297 | ) | ||||||||||||||||||||
Interest – refinancing gain (costs)
|
1,698 | - | - | 1,698 | (5,410 | ) | - | - | (5,410 | ) | ||||||||||||||||||||||
Equity in earnings
|
2,712 | - | (2,712 | ) | - | 5,510 | - | (5,510 | ) | - | ||||||||||||||||||||||
Total other expense
|
(16,393 | ) | (3,865 | ) | (2,712 | ) | (22,970 | ) | (40,439 | ) | (7,718 | ) | (5,510 | ) | (53,667 | ) | ||||||||||||||||
Income before gain on assets sold
|
28,604 | 2,712 | (2,712 | ) | 28,604 | 49,372 | 5,510 | (5,510 | ) | 49,372 | ||||||||||||||||||||||
Gain on assets sold – net
|
1,968 | - | - | 1,968 | 7,284 | - | - | 7,284 | ||||||||||||||||||||||||
Net income available to common stockholders
|
$ | 30,572 | $ | 2,712 | $ | (2,712 | ) | $ | 30,572 | $ | 56,656 | $ | 5,510 | $ | (5,510 | ) | $ | 56,656 |
21 |
|
(i)
|
those items discussed under “Risk Factors” in Item 1A to our annual report on Form 10-K for the year ended December 31, 2012, and in Part II, Item 1A of our Quarterly Report on From 10-Q for the three months ended March 31, 2013 and in Part II, Item 1A of this report;
|
|
(ii)
|
uncertainties relating to the business operations of the operators of our assets, including those relating to reimbursement by third-party payors, regulatory matters and occupancy levels;
|
|
(iii)
|
the ability of any operators in bankruptcy to reject unexpired lease obligations, modify the terms of our mortgages and impede our ability to collect unpaid rent or interest during the process of a bankruptcy proceeding and retain security deposits for the debtors’ obligations;
|
|
(iv)
|
our ability to sell closed or foreclosed assets on a timely basis and on terms that allow us to realize the carrying value of these assets;
|
|
(v)
|
our ability to negotiate appropriate modifications to the terms of our credit facilities;
|
|
(vi)
|
our ability to manage, re-lease or sell any owned and operated facilities;
|
|
(vii)
|
the availability and cost of capital;
|
|
(viii)
|
changes in our credit ratings and the ratings of our debt securities;
|
|
(ix)
|
competition in the financing of healthcare facilities;
|
|
(x)
|
regulatory and other changes in the healthcare sector;
|
|
(xi)
|
the effect of economic and market conditions generally and, particularly, in the healthcare industry;
|
|
(xii)
|
changes in the financial position of our operators;
|
|
(xiii)
|
changes in interest rates;
|
|
(xiv)
|
the amount and yield of any additional investments;
|
|
(xv)
|
changes in tax laws and regulations affecting real estate investment trusts; and
|
|
(xvi)
|
our ability to maintain our status as a real estate investment trust.
|
22 |
23 |
24 |
25 |
26 |
27 |
FFO is a non-GAAP financial measure. We use FFO as one of several criteria to measure operating performance of our business. We further believe that by excluding the effect of depreciation, amortization, impairment on real estate assets and gains or losses from sales of real estate, all of which are based on historical costs and which may be of limited relevance in evaluating current performance, FFO can facilitate comparisons of operating performance between periods and between other REITs. We offer this measure to assist the users of our financial statements in evaluating our financial performance under GAAP, and FFO should not be considered a measure of liquidity, an alternative to net income or an indicator of any other performance measure determined in accordance with GAAP. Investors and potential investors in our securities should not rely on this measure as a substitute for any GAAP measure, including net income.
28 |
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
June 30,
|
June 30,
|
|||||||||||||||
2013
|
2012
|
2013
|
2012
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Net income available to common stockholders
|
$ | 49,058 | $ | 30,572 | $ | 87,178 | $ | 56,656 | ||||||||
Add back loss (deduct gain) from real estate dispositions
|
1,151 | (1,968 | ) | 1,151 | (7,284 | ) | ||||||||||
Sub-total
|
50,209 | 28,604 | 88,329 | 49,372 | ||||||||||||
Elimination of non-cash items included in net income:
|
||||||||||||||||
Depreciation and amortization
|
32,225 | 27,199 | 64,184 | 54,346 | ||||||||||||
Add back impairments on real estate properties
|
— | — | — | 272 | ||||||||||||
Funds from operations available to common stockholders
|
$ | 82,434 | $ | 55,803 | $ | 152,513 | $ | 103,990 |
29 |
30 |
31 |
32 |
33 |
34 |
Exhibit No.
|
||
10.1
|
Omega Healthcare Investors, Inc. 2013 Stock Incentive Plan (incorporated by reference to Annex A to the Registrant’s Proxy Statement on Schedule 14A filed on April 22, 2013).
|
|
10.2
|
Form of Officer Deferred Performance Restricted Stock Unit Agreement.*
|
|
31.1
|
Rule 13a-14(a)/15d-14(a) Certification of the Chief Executive Officer.
|
|
31.2
|
Rule 13a-14(a)/15d-14(a) Certification of the Chief Financial Officer.
|
|
32.1
|
Section 1350 Certification of the Chief Executive Officer.
|
|
32.2
|
Section 1350 Certification of the Chief Financial Officer.
|
|
101.INS
|
XBRL Instance Document.**
|
|
101.SCH
|
XBRL Taxonomy Extension Schema Document.**
|
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document.**
|
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document.**
|
|
101.LAB
|
XBRL Taxonomy Extension Label Linkbase Document.**
|
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document.**
|
35 |
OMEGA HEALTHCARE INVESTORS, INC. | |||||
Registrant | |||||
Date: August
5
, 2013
|
By:
|
/S/ C. TAYLOR PICKETT | |||
C. Taylor Pickett | |||||
Chief Executive Officer | |||||
Date: August 5, 2013 |
By:
|
/S/ ROBERT O. STEPHENSON | |||
Robert O. Stephenson | |||||
Chief Financial Officer |
36 |
|
A.
|
Effect of Agreement
: This Agreement relates to the grants of performance restricted stock units specified in paragraph D below.
|
|
B.
|
“
Plan
”: (under which the “Shares” (as defined below) will be issued) Omega Healthcare Investors, Inc. 2004 Stock Incentive Plan.
|
|
C.
|
“
Deferred Stock Plan
”: Omega Healthcare Investors, Inc. Deferred Stock Plan, to which this Agreement is also subject.
|
|
D.
|
“
Stock Units
”: This Agreement relates to the percentage or number of Stock Units issuable pursuant to the grants of performance restricted stock units with respect to the Company’s common stock specified below. (You must check the box(es) that apply):
|
|
[ ]
|
___% or ________ [if you checked the box, you must either fill in the
percentage or insert the number of Stock Units to be deferred] of the
multi-
year performance restricted stock unit grant for the performance
period
2011 – 2013.
|
|
[ ]
|
___% or ________ [if you checked the box, you must either fill in
the
percentage or insert the number of Stock Units to be deferred] of the
annual
performance restricted stock unit grant for the 2013
performance
period.
|
|
|
E.
|
“
Dividend Equivalents
”: Each Stock Unit shall accrue an amount equal to the dividends per share payable on Common Stock to shareholders of record in accordance with the terms of the Original Agreement through
the Original Payment Date
and thereafter through the day before the date the Shares are issued.
|
|
1.
|
[ ]
|
“
Converted Dividend Equivalents
”: The Dividend Equivalents will be converted into a number of Stock Units equal to (a) the amount of the Dividend Equivalents that are accrued under the Original Agreement as of the date that payment would otherwise have been made under the Original Agreement, divided by the closing price per share of Stock on such date, plus (b) the amount of the Dividend Equivalents that are accrued thereafter as of each dividend payment date, divided by the closing price per share of Stock on such date. Such Stock Units shall also accrue future Dividend Equivalents that shall be converted into Stock Units in accordance with the preceding formula in subparagraph (b). The Stock Units under this paragraph shall be paid on the date the Shares are payable to the Officer; or
|
|
2.
|
[ ]
|
“
Deferred Dividend Equivalents
”: The Dividend Equivalents
shall be paid to the Officer
, with interest accrued on a quarterly basis from the Original Payment Date at a rate equal to the Company’s average borrowing rate for the preceding calendar quarter, as determined in the sole discretion of the Committee, on the date the Shares are payable to the Officer
; or
|
|
3.
|
[ ]
|
“
Current Dividend Equivalents
”: The Dividend Equivalents that are accrued as of the Original Payment Date shall be paid to the Officer on the Original Payment Date and the Dividend Equivalents thereafter will be paid on the same date that the dividends per share are paid to shareholders.
|
( ii ) |
|
F.
|
“
Deferral Period
”: The Officer has elected to defer receipt of the Shares (and Converted Dividend Equivalents or Deferred Dividend Equivalents if paragraph E.1. or E.2. was elected) until the dates or events set forth below:
|
|
1.
|
If you complete this paragraph 1, you must complete A or B below:
|
|
A.
|
[ ]
|
in one lump sum in the month of ___________, 20___ (specify month and year); or
|
|
B.
|
[ ]
|
in annual ratable installments over __ calendar years (specify number of calendar years) with the first payment being made in the month of ___________, 20___ (specify month and year) and each subsequent payment being made in the month of _________ (specify month) of each calendar year thereafter.
|
|
2.
|
If you complete this paragraph 2, you must check A or B below, but not both:
|
|
B.
|
[ ]
|
in the month of _____________ (specify month) of the __________ (specify number, first, second, etc.) calendar year following the calendar year of the Officer’s Separation from Service (but not earlier than six (6) months following the Officer’s Separation from Service.
|
|
(i)
|
[ ]
|
in one lump sum; or
|
|
(ii)
|
[ ]
|
in annual ratable installments over __ calendar years (specify number of calendar years), with each payment after the first payment being made in the month of ____________ (specify month) of each calendar year.
|
( iii ) |
|
5.
|
[ ]
|
If a Change in Control occurs before the date payment is required to be made pursuant to the elections above, payment shall be made in one lump sum upon the Change in Control.
|
|
6.
|
[ ]
|
If the Officer becomes subject to a Disability before the date payment is required to be made pursuant to the elections above, payment shall be made in one lump sum upon the Disability.
|
|
(i)
|
the election shall not take effect until twelve (12) months after the date the written election is submitted to the Company;
|
|
(ii)
|
in the case of an election related to a payment date or event other than Disability, the election must defer payment for at least five (5) years from the date payment would otherwise have been made under this Agreement (i.e., date of lump sum or first installment payment); and
|
|
(iii)
|
in the case of a payment at a specified date, the election must be submitted at least twelve (12) months before the date payment (i.e. lump sum or first installment payment) was previously scheduled to be made under this Agreement.
|
OFFICER | OMEGA HEALTHCARE INVESTORS, INC. | |||
By: | ||||
[Signature] | Title: |
( iv ) |
|
(a)
|
“
Change in Control
” means:
|
|
i.
|
“A change in the ownership of the corporation,”
|
|
ii.
|
“A change in the effective control of the corporation,” or
|
|
iii.
|
“A change in the ownership of a substantial portion of the assets of the corporation,”
|
|
(b)
|
“
Disability
” means any condition that would constitute a “disability” under the Deferred Stock Plan.
|
|
(c)
|
“
Separation from Service
” means a “separation from service” within the meaning of Treas. Reg. Section 1.409A-1.
|
|
(d)
|
“
Unforeseeable Emergency
” means an “unforeseeable emergency” within the meaning of Treas. Reg. Section 1.409A-3.
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Omega Healthcare Investors, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: August 5, 2013 | |||
/S/ C. TAYLOR PICKETT | |||
C. Taylor Pickett | |||
Chief Executive Officer |
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Omega Healthcare Investors, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: August
5, 2013
|
|||
|
/S/ ROBERT O. STEPHENSON | ||
Robert O. Stephenson | |||
Chief Financial Officer |
|
(1)
|
the Quarterly Report on Form 10-Q of the Company for the three months ended June 30, 2013 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
|
(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date: August
5, 2013
|
|
||
/S/ C. TAYLOR PICKETT | |||
C. Taylor Pickett | |||
Chief Executive Officer |
|
(1)
|
the Quarterly Report on Form 10-Q of the Company for the three months ended June 30, 2013 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
|
(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date: August
5
, 2013
|
|||
/S/ ROBERT O. STEPHENSON | |||
Robert O. Stephenson
|
|||
Chief Financial Officer
|